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So you want to stash some cash in a safe place but aren’t sure whether or not to open a money market account or a certificate of deposit. Here are some things to consider.

Money Markets Offer Checks

First, let’s look at how these products work. A money market account is basically a savings account, but pays more than many regular savings or checking accounts. Right now the average yield on money market accounts is 1.3%, nothing to write home about but you do get a small return on your money.

Money markets usually allow you to write a limited number of checks. Money market rates can fluctuate. Begin hunting for money market rates here.

CD Rates Vary Based on Term

Certificates of deposit tie up your money for specific periods of time for the privilege of earning interest. CDs can have a maturity of a few weeks to several years. The longer your money is in a CD, the higher the rate of interest you can get. Right now, the average 2-year CD rate is 1.96%. Search for CD rates here.

If you want your money to stay safe, CDs offer FDIC insurance up to $250,000 per individual. But you won’t have access to your money during the term of the CD and have to pay a penalty for early withdrawal.

Banks have come under fire for heaping multiple overdraft fees on unsuspecting customers. But a couple of banks are changing their rules in what they say is an attempt to help customers who are struggling financially. Some of the changes include:

Bank of America won’t charge fees to customers who overdraw their checking accounts by less than $10 a day. The bank also says it plans to charge only up to four overdrafts a day, down from the current 10. The changes take affect next month.

JP Morgan Chase will clear debit and ATM transactions in the order in which they occur. Many banks have been criticized for clearing the largest transactions first, which often results in customers overdrawing their checking accounts. Customers will be required to sign up for overdraft services if they want that protection. Those changes go into affect early next year.

The rule changes come as some legislators have turned their attention to reining in fees at banks. Overdraft fees are expected to total $38.5 billion this year, according to economic research firm Moebs Services.

American Express is known for charge cards and credit cards. But the bank has two products that can help you build savings. The bank’s high-yield savings account currently has a 1.85% annual percentage rate (APY) and its 24-month CD rate is 2.35% APY. Other CD terms are also available.

Once the CD matures you have a 10-day grace period to withdraw the money, renew it at current CD rates, or transfer the money to a high-yield savings account. Statements are sent online or by mail each month.

You can open American Express certificates of deposit and high-yield savings accounts as individual or joint accounts, but not trust accounts.

Federal Reserve Chairman Ben Bernanke says the recession is likely over. However, he said that although the economy is probably growing now, unemployment will continue to rise from its current level of 9.7%. About 6.9 million jobs have been lost since the recession began in December 2007, and many of those people will have a tough time for a while to come.

“From a technical perspective, the recession is very likely over at this point. It’s still going to feel like a very weak economy for some time because many people will still find that their job security and their employment status is not what they wish it was,” Bernanke warned.

This means that many Americans who have drastically cut back spending, will probably continue to hold on to their wallets and put more money into savings. The average U.S. savings rate has risen to 4.5% this year.

So where should you put your money if you want to save more whether the economy is truly on the upswing or not? A certificate of deposit can be a good place to put money that you won’t need to get at for a while. Begin your search for a certificate of deposit here. If you need to keep your money more liquid, look for basic savings and money market accounts.

OneWest Bank has competitive CD rates that include 2.4% annual percentage yield (APY) for two years and 3.4% APY for five years if you open an account online. Other online CD rates at the bank include:

1.3% APY for three months

1.8% APY for nine months

2.1% APY for one year

2.8% APY for three years

2.9% APY for four years

To open a certificate of deposit you need a minimum opening deposit of $5,000. Interest is fixed and is compounded daily and paid or reinvested into the CD account monthly or at maturity. Certificates of deposit renew automatically at the current rate available for the same term. The CD rate you receive also is based on the account balance.

There is a seven-day grace period beginning the day after maturity during which you can withdraw or transfer funds to another account. You pay a penalty for withdrawing money early. For example, if you withdraw money early from a CD that has a term of one year or longer, the penalty would be six months of simple interest at the rate being paid on the amount that is withdrawn.

OneWest Bank also has an online Raise Your Rate CD that allows you to request a rate increase once during the term. The maturity date remains the same after the CD rate increase.

Bank rates
provided by MoneyRates.com based on average rates for deposits under $10K and conforming mortgage rates

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appearing on this site are from advertisers from which this website receives compensation for being listed here.
This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). These offers do not represent all deposit accounts available.